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Growth in Philippine Call Centers jacked up by global crisis?

Q: Key Point 4: It makes sense actually -- for every seat you drop...

It makes sense actually -- for every seat you drop in the US, you can get as much as 4 to 5 new seats in the Philippines at the same cost.

Abe Olandres October 12, 2008 · 2 min read

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Turns out the credit crisis and the recession in the United States had some unwittingly beneficial effect in the BPO and call center industry in the Philippines. I would have expected job cuts around this time but it seems there’s some massive expansion going on.

A friend, who works in one of the top call centers in the Philippines, revealed they’ve been doing rapid expansion and is opening up at least 5 more locations around the country from this year to next year. There’s one in Sta. Rosa, Laguna, then in Cebu, the newly built Greenbelt 5, the UP Science Center in Q.C., and San Lazaro, Manila.

If that’s any indication, I’d say the BPO industry in the Philippines is still growing despite the recession. But how did that happened?

My friend explains that because of the financial crisis in the US, there were a lot of job cuts going around. These job cuts are cost-cutting measures — no new hires in the US; all replacements are made in somewhere else where it’s cheaper (including) the Philippines.

It makes sense actually — for every seat you drop in the US, you can get as much as 4 to 5 new seats in the Philippines at the same cost.

The industry will still survive. It’s just a matter of resource allocation and cost-reduction. While the Philippines may not be immune to the same economic crisis, it has proven still that our labor force is cost-effective.

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Abe Olandres

Editor-in-chief

Abe is the founder and Editor-in-Chief of YugaTech with over 20 years of experience in the technology industry. He is one of the pioneers of blogging in the country and considered by many as the Father of Tech Blogging in the Philippines. He is also a technology consultant, a tech columnist with several national publications, resource speaker and mentor/advisor to several start-up companies.

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70 Comments

Steven Kenneth · 7 years ago

And I’m sure it’s still growing.

asiateloutsourcing · 8 years ago

Yes call centers and the outsourcing business in general is booming.its a great news to Thousands of young graduate. Sounds Good

Lace Manufacturers · 15 years ago

its a great news to Thousands of young graduates who would have been jobless, and will find employment in call centres.

Business Process Outsourcing · 15 years ago

Oh really. I read in one article, Call center services started at Philippine and this country is the giving best call center services. I think now all the business are good and doing well. What is the position of this country. is this country still in same position?

business process outsourcing · 16 years ago

Oops! I astonished;how for? really this is a good industry there is no down period; when all fields are in fall…

Outsourcing Call Centers · 16 years ago

Eventually, the call center in the Philippines is expected to develop more than ever in the coming years. So letâ€™s continue servicing our customerâ€™s concern that international clients will trust unto us.

philippine contact center · 16 years ago

BPO industry in the Philippines has been continuously opening up employment opportunities even as other countries continue to struggle with their lagging job markets because of the recession. Thousands of young graduates who would have been jobless found employment in call centers and contact center Philippines that sprouted all over the country in the past few years.

Business Lead Generation · 16 years ago

Despite from the global crisis that threatens our economy, there are still positive sides that we can benefit.Trying to be optimistic, local business leaders say that the slowdown in the US economy would benefit the Philippines as it creates unique opportunity, our country being an attractive investment destination.

Philippines Call Center · 16 years ago

call centers in the Philippines are taking in Billions now and they say by 2011 it will increase by another 15% thats staggering compared to any other industry, is it not?

Kristina · 17 years ago

It is true that a lot of US companies are outsourcing to cut costs even up to the present. The most recent that I’ve heard of is that GM (General Motors) has ventured to the BPO industry already with a Philippine Call Center.

call center philippines · 17 years ago

I also noticed that despite the recession, the Sunday Paper job ads are full of openings for call center type jobs.

It actually make sense that the BPO industry would increase in times of recession since people in the US would find ways to cut down costs which is what BPO is all about.

Jules · 17 years ago

The best medium to long term strategy for call centers in the Philippines to adopt is to upgrade their skillsets into more value added disciplines like computer programming and engineering design. Specifically LAMP (Linux, Apache, MySQL, Apache), Oracle, SAP and Java/C++/Embedded Systems for these are the skillsets of the future to improve business operations. This is the reason why so many of our countrymen are now living in Singapore because they were pirated from companies operating in our country. Our edge in language skills is slowly being eroded by the improvement in our Asian neighbors and Eastern European countries that are also building an army of English proficient cheap by western standards, knowledge workers. Sooner or later we won’t be as competitive as they are. You should all remember that multinational companies have no loyalty to one particular country. They are loyal to their bottomline and shareholders. They will do whatever means possible to accomplish their goals even at the expense of leaving the Philippines for another cheaper country to achieve better cost efficiencies. That is all the more reason for call center workers to plan one step ahead of that imminent scenario.

raymond · 17 years ago

well its still better to keep the business than lose it after all. if im an owner of a business and im facing a big loss bec of something like recession, then i would certainly look for an alternative way to get my business going

but still..not all BPO companies look at this option. they would rather lay some people off than to look for another option simply bec its the fastest way they could do to hold their money.

its really hard to see people, who has become a family, getting out of the company.

eve yap · 17 years ago

SHOULD THERE BE ANY NEWLY OPENED CALL CENTERS PLANNING FOR EXPANSION, W/C WILL BE NEEDING AN I.T. EQUIPMENTS SUCH AS LAPTOP,DESKTOP,MONITORS, SERVERS,WORKSTATIONS,PROCURVE SWITCH, PRINTERS. PLEASE FEEL FREE TO ASK ME—
Eve Yap
(Corp. Sales Exec.)/
Email: Ev****@phildata.com
/Direct KLine: 8112878 loc.215
/mobile#: 0918******* — OR YOU MAY BROWSE OUR LINK http://www.phildata.com/.

PingBack · 17 years ago

Does anyone have an idea in how
I could get a list of accounts lost
by ACS, IBM and other contact center
companies localy?

call center Philippines · 18 years ago

Business Process Outsourcing is now on its fast-pace. More and more business savvy are investing greatly on call center in the Philippines because Filipino people are said to be patient, caring (for clients), honest, hardworking and also an effective English conversant, among others. So to whom will you trust your business? The answer is definitely obvious.

Vadim Berman · 18 years ago

This one is a nobrainer.

Less paying customers => megacorps need to save on expenses => hire cheap manpower. Yep, Phils should benefit from it. A lot.

Jomark Osabel · 18 years ago

Yes call centers and the outsourcing business in general is booming. Here in Cebu call centers are sprouting like mushrooms. Likewise, home based outsourcing services are proliferating. I employ about 4 people at home serving clients from the US, Europe and the Australia. They prefer us because we are far more cost effective to deal with than those with corporate structure.

Mr Blogger · 18 years ago

That’s good news as it would mean more jobs for the Filipinos. I also worked in call centers before. Above all negativities, I still have high hopes for our country.

David B Katague · 18 years ago

What other industry in the Philippines are expanding in spite of the current global economic crises, besides the call center business? Is the tourism business OK?

bongsi21 · 18 years ago

I think we must be optimistic in this current times of economic set-back. If we keep cross-cutting jobs etc. it’ll eventually hurt the whole economy of the Philippines. Cross-cutting cost can be sum in many ways like right management of people, reduction/optimization of work flow etc, create a long-term solution not just removing numerous quality Filipino personnel just to save some bucks! Our country has abundant source of quality people we just have to utilize it to the full extent.

calvin · 18 years ago

ei bpo office namin ah. bat walang salary increase? :P abe di ka umattend ng silverlight training?

Abe Olandres Editor-in-chief · 18 years ago

@donalyza – thanks for the correction — I read GB5 instead of G5.

@Dwight – CVG. ;)

donalyza · 18 years ago

Yup 5 more locations, but it’s not in Greenbelt 5 but soon to rise, Glorietta 5.

Dwight Alcantara · 18 years ago

I am working in a call center and I am near in sm san lazaro and your friend told you that their company is planning to put one site in sm san lazaro? may i know the name of the call center?

max · 18 years ago

is this speculation? an opinion? or fact?

herbert · 18 years ago

On the other hand, because of the same recession, accounts are lost in some call centers. SIS, for example, lost Toshiba because the latter can no longer afford paying the company. Account was transferred to Sitel and Teleperformance because they offer cheap rates. Washington Mutual’s account with SIS will also end soon. Don’t know yet where it will be transferred.

BrianB · 18 years ago

Abe, the next US president will make sure much of these call center jobs will go back home to curb the unemployment there in the US. It’s probably just very temporary, a quick solution to the cash hemorrhage.

Jerome · 18 years ago

@Juan Paolo Jamon: Very True.

aldwin · 18 years ago

whew! I thought mawawalan na ako ng.trabaho…huhuhu

Juan Paolo Jamon · 18 years ago

This may be the case for now, that getting labor from the Philippines is indeed cheaper for other countries. However, since the US is experiencing recession, the next U.S. administration may probably (if it wants its economy to survive by giving their people more jobs) advocate and advances new policies that will grant the American people more employment opportunities… (for example) — policies saying, “no more outsourcing or limit outsourcing employment to create more jobs for your own countrymen.” Such policies will most likely be ratified by the next American administration. The Philippine government should be coming up with measures to address this probable crisis in the future. Imagine how many jobs will be lost if the Call Center Industry flees the country. Unemployment will indeed boom.

David B Katague · 18 years ago

More Power to the Call Center business in the Philippines. Just recently I had business with one of the call centers in PI from US. I was very satisfied with the service rendered. It appears that the employees are well-trained and very knowledgeable.

Patrick · 18 years ago

Oh really? This is exactly the opposite of what I was expecting. I used to work in a callcenter but I returned to IT early this year. I have yet to ask my previous colleagues about how business was affected by the crisis.

Back Office Services · 15 years ago

Yes this is really a great news. We never heard about BPO business in Philippine. Now we are hearing that its rocking in BPO services. This is really great news for who has searching for job. Thanks for sharing.